Company Brief

Purchase account

Account purchase occurs because the company buys merchandise for the purpose of resale. Purchases of merchandise can be done in three ways, namely the purchase of cash, credit purchases, the purchase of some cash and some credit.

To purchase items not for resale are recorded in different accounts. Purchase of such merchandise in addition to equipment purchases are recorded on the account that purchased the equipment and if the equipment is recorded under equipment. Source documents obtained from the activities of these purchases are invoices or receipts.

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